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Some small-business owners say they will choose to pay the Affordable Care Act's tax penalty instead of complying with the law's mandate to offer health insurance to their employees. Others say they will reduce staff hours to avoid being subject to the mandate.

Related Summaries

A group representing health insurers expressed concern that recently announced exemptions to the Affordable Care Act's insurance enrollment deadlines, along with a rule allowing people whose plans have been canceled to buy only catastrophic coverage, will erode the law's mandate.

The implementation of the employer mandate provision of the health care reform law has been delayed until 2015. The mandate requires businesses with 50 or more employees to provide health insurance or pay a penalty of up to $3,000 per worker.

Some states that are building their own health insurance exchanges under the Affordable Care Act plan to offer an exchange with a variety of options for employees of small businesses, despite the Obama administration's decision to delay the employee choice component of the Small Business Health Option Program in federally run marketplaces.

Guidance issued by the Department of Health and Human Services says companies will be allowed to change insurance carriers without being required to follow some new health law coverage mandates. The government has stated that employers can avoid the law's preventive-care requirements if they don't make major alterations to their current benefits or costs for employees.

Revised health care reform legislation would exempt more small businesses from a requirement that would force them to choose between providing health insurance to workers and paying a penalty. Under the bill, companies with payrolls of less than $500,000 are exempt from the mandate. Democratic lawmakers say the provision will allow the legislation to move forward. However, some Republicans say the legislation will still hurt small businesses.